How state and federal policies as well as advances in genome science contribute to the high cost of cancer drugs

Health Affairs

Volumn 34, Issue 4, 2015, Pages 571-575

  Ramsey, Scott D ^a  

^a Fred Hutchinson Cancer Research Center   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

ANTINEOPLASTIC AGENT;

ARTICLE; CANCER GENETICS; CANCER INCIDENCE; CANCER PATIENT; COST EFFECTIVENESS ANALYSIS; DRUG COST; DRUG INDUSTRY; FOOD AND DRUG ADMINISTRATION; GENE SEQUENCE; GENOME; GOVERNMENT; HEALTH CARE POLICY; HEALTH INSURANCE; HUMAN; INSURANCE; LAW; MEDICAID; MEDICARE; MOLECULAR BIOLOGY; ECONOMIC ASPECT; ECONOMICS; LEGISLATION AND JURISPRUDENCE; NEOPLASMS; PHARMACOECONOMICS; TRENDS; UNITED STATES;

ANTINEOPLASTIC AGENTS; DRUG COSTS; DRUG INDUSTRY; ECONOMIC COMPETITION; ECONOMICS, PHARMACEUTICAL; HEALTH POLICY; INSURANCE COVERAGE; NEOPLASMS; PATIENT PROTECTION AND AFFORDABLE CARE ACT; UNITED STATES;

EID: 84929613226     PISSN: 02782715     EISSN: 15445208     Source Type: Journal    
DOI: 10.1377/hlthaff.2015.0112     Document Type: Article

References (30)

1. Ramsey SD. How should we pay the piper when he's calling the tune? On the long-term affordability of cancer care in the United States. J Clin Oncol. 2007;25(2):175-9.
2. Abboud C, Berman E, Cohen A, Cortes J, DeAngelo D, Deininger M, et al. The price of drugs for chronic myeloid leukemia (CML) is a reflection of the unsustainable prices of cancer drugs: fromthe perspective of a large group of CML experts. Blood. 2013;121(22):4439-42.
3. Meropol NJ, Schrag D, Smith TJ, Mulvey TM, Langdon RM Jr, Blum D, et al. American Society of Clinical Oncology guidance statement: the cost of cancer care. J Clin Oncol. 2009;27(23):3868-74.
4. Schrag D. The price tag on progress-chemotherapy for colorectal cancer. N Engl J Med. 2004;351(4):317-9.
5. Danzon PM, Taylor E. Drug pricing and value in oncology. Oncologist. 2010;15(Suppl 1):24-31.
6. Bach PB.Why drugs cost so much. New York Times. 2015 Jan 15; Sect. A:29.
7. Lakdawalla D, Shafrin J, Lucarelli C, Nicholson S, Khan Z, Philipson T. Quality-adjusted cost of care: a meaningful way to measure growth in innovation cost versus the value of health gains. Health Aff (Millwood). 2015;34(4):555-61.
8. Stevens W, Philipson T, Khan Z, MacEwan JP, Linthicum M, Goldman DP. Cancer mortality reductions were greatest among countries where cancer care spending rose the most, 1995-2007. Health Aff (Millwood). 2015;34 (4):562-70.
9. A few of the well-known, longstanding market distortions include marked asymmetry of information between purchaser (patient) and seller (doctor, drug company); health insurance, which lowers the effective purchase price to patients to pennies on the dollar, creating incentives for moral hazard; large transaction costs that prevent purchasers from bargaining with sellers to achieve a lower price; and the influence on oncologists, who otherwise would act as patients' agents, by the markups-the difference between the cost to doctors when they purchase oncology drugs from manufacturers and the higher amount doctors charge insurers when they prescribe those drugs for their patients.
10. Bach PB. Limits on Medicare's ability to control rising spending on cancer drugs. New Engl J Med. 2009; 360(6):626-33.
11. Howard DH, Bach PB, Berndt ER, Conti RM. Pricing in the market for anticancer drugs [Internet]. Cambridge (MA): National Bureau of Economic Research; 2015 Jan [cited 2015 Feb 25]. NBER Working Paper No. 20867. Available from: http:// www.nber.org/papers/w20867
12. Medicare Learning Network. MMA-July 2005 quarterly average sales price (ASP) Medicare Part B drug pricing file, effective July 1, 2005 [Internet]. Baltimore (MD): Centers for Medicare and Medicaid Services; [updated 2013 Feb 4; cited 2015 Feb 25]. MLN Matters No. MM3783. Available from: http://www.cms .gov/Outreach-and-Education/ Medicare-Learning-Network-MLN/ MLNMattersArticles/downloads/ MM3783.pdf
13. Jacobson M, O'Malley AJ, Earle CC, Pakes J, Gaccione P, Newhouse JP. Does reimbursement influence chemotherapy treatment for cancer patients? Health Aff (Millwood). 2006; 25(2):437-43.
14. Levinson DR. Medicaid drug price comparison: average sales price to average wholesale price [Internet]. Washington (DC): Department of Health and Human Services, Office of Inspector General; 2005 Jun [cited 2015 Feb 25]. Available from:http://oig.hhs.gov/oei/reports/oei-03-05-00200.pdf
15. Social Security Administration. Compilation of the Social Security laws: Part E-miscellaneous provisions:definitions of services, institutions, etc. Sect. 1861 [Internet]. Washington (DC): SSA; [cited 2015 Feb 25]. Available from: www.ssa .gov/OP_Home/ssact/title18/1861.htm
16. Abernethy AP, Raman G, Balk EM, Hammond JM, Orlando LA,Wheeler JL, et al. Systematic review: reliability of compendia methods for offlabel oncology indications. Ann Intern Med. 2009;150(5):336-43.
17. Henry J. Kaiser Family Foundation. Total number of Medicare beneficiaries [Internet]. Menlo Park (CA):KFF; [cited 2015 Feb 25]. Available from: http://kff.org/medicare/stateindicator/ total-medicarebeneficiaries/
18. Medicaid.gov. Medicaid: by population [Internet]. Baltimore (MD):Centers for Medicare and Medicaid Services; [cited 2015 Feb 25]. Available from: http://www.medicaid .gov/Medicaid-CHIP-Program-Information/By-Population/By-Population.html
19. Smith BD, Smith GL, Hurria A, Hortobagyi GN, Buchholz TA. Future of cancer incidence in the United States: burdens upon an aging, changing nation. J Clin Oncol. 2009; 27(17):2758-65.
20. The expected increase in the number of newly diagnosed cancers among older adults will be much higher:nearly 75 percent.
21. Vogelstein B, Papadopoulos N, Velculescu VE, Zhou S, Diaz LA Jr, Kinzler KW. Cancer genome landscapes. Science. 2013;339(6127):1546-58.
22. Garraway LA, Lander ES. Lessons from the cancer genome. Cell. 2013; 153(1):17-37.
23. Armitage P, Doll R. The age distribution of cancer and a multi-stage theory of carcinogenesis. Br J Cancer. 1954;8:1-12.
24. Fearon ER, Vogelstein B. A genetic model for colorectal tumorigenesis. Cell. 1990;61(5):759-67.
25. Danzon P, Towse A. The economics of gene therapy and of pharmacogenetics. Value Health. 2002;5(1):5-13.
26. About 80 percent of all lung cancers are non-small-cell type, and about 50 percent of patients with this type are diagnosed with advanced disease. Of those, 5 percent might be eligible for Xalkori.
27. Ciritinib was first approved for treatment of patients with anaplastic lymphoma kinase-positive, metastatic non-small-cell lung cancer who showed disease progression while on or were intolerant to crizotinib. It is now being tested as a first-line therapy.
28. Djalalov S, Beca J, Hoch JS, Krahn M, Tsao MS, Cutz JC, et al. Cost effectiveness of EML4-ALK fusion testing and first-line crizotinib treatment for patients with advanced ALK-positive non-small-cell lung cancer. J Clin Oncol. 2014;32(10):1012-9.
29. While there is no single agreed-upon threshold for what constitutes costeffective care in the United States, recent reports suggest that the threshold is between $100,000 and $150,000 per quality-adjusted lifeyear. See Neumann PJ, Cohen JT, Weinstein MC. Updating costeffectiveness- the curious resilience of the $50,000-per-QALY threshold. N Engl J Med. 2014;371(9):796-7.
30. While the ingredient price does not change, prices for a course of therapy may vary from cancer to cancer based on the dose and duration of treatment.